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REITs investing & personal finance

Sunday, February 02, 2025

Keppel DC REIT's 2H FY24 Result Review

Sunday, February 02, 2025 AJBU , KDC 0 Comments

Basic Profile & Key Statistics


Key Indicators


Performance Highlight

KDC reported an improvement in gross revenue and NPI YoY, driven by the stronger performance of Keppel DC REIT's existing portfolio and the contribution from the newly acquired Tokyo DC 1. Coupled with the $5.6 million distribution from the DXC settlement sum, both distributable income and DPU saw significant increases.

Acquisition

On 27 December 2024, Keppel DC REIT completed the acquisition of KDC SGP 7 & 8, further strengthening its portfolio in Singapore.

Divestment

On 2 January 2025, Keppel DC REIT announced the divestment of the Basis Bay Data Centre in Malaysia. The divestment is expected to be completed around 3Q 2025.

Related Parties Shareholding

  • REIT Sponsor's Shareholding: Less Favorable
  • REIT Manager's Shareholding: Moderate
  • Directors of REIT Manager's Shareholding: Less Favorable

Lease Profile

  • Committed Occupancy: Moderate
  • Highest Annual Lease Expiry in 4 Years: Favorable
  • WALE: Moderate
  • Weighted Average Land Lease Expiry: Less Favorable

Debt Profile

  • Adjusted Interest Coverage Ratio: Favorable
  • Cost of Debt: Favorable
  • Gearing Ratio: Favorable
  • Fixed Rate Debt Proportion: Less Favorable
  • Unsecured Debt Proportion: Favorable
  • Highest Annual Debt Maturity in 4 Years: Moderate
  • WADM: Moderate

Diversification Profile

  • Top Geographical Weightage: Moderate
  • Top Property Weightage: Moderate
  • Top 5 Properties' Weightage: Favorable
  • Top Tenant Weightage: Moderate
  • Top 10 Tenants' Weightage: Less Favorable

Key Financial Metrics

  • Property Yield: Favorable
  • Operating Distributable Income over Manager's Fees: Moderate
  • Operating Distributable Income on Capital: Favorable
  • Operating Distributable Income Margin: Favorable
  • Operating Distribution Proportion: Favorable

DPU Breakdown

  • TTM Distribution Breakdown:
    • 937% from Operation
    • 2.9% from Management Fees Paid in Units
    • 0.1% from Income Support
    • 3.4% being Retained

Trends (Up to 10 Years)



  • Uptrend: DPU from Operations, NAV per Unit, Committed Occupancy
  • Slight Uptrend: None
  • Flat: Operating Distributable Income Margin, Operating Distribution Proportion
  • Slight Downtrend: Top 10 Tenants' Weightage
  • Downtrend: Adjusted Interest Coverage Ratio, Top 5 Properties' Weightage, Property Yield, Operating Distributable Income over Manager's Fees, Operating Distributable Income on Capital

Price Range & Relative Valuation Metrics



  • Dividend Yield: Below -1SD for 3y; Average for 1y, 5y & 10y
  • P/NAV: Average for 1y, 3y, 5y & 10y

Author's Opinion

While gross revenue and net property income (NPI) declined compared to the previous half-year, distributable income and DPU increased significantly. This improvement was driven by a combination of factors, including higher finance income, lower finance costs, higher forex gains, higher gains on derivatives, and a substantial positive adjustment in "other net adjustments" under the distribution adjustment (+$6.162 million in 2H vs. -$12.107 million in 1H). On the debt front, only 3.8% of total debt is maturing in 2025. 

For more information, check out:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and details of Singapore REIT

REIT Review - List of previous REIT review posts


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*Disclaimer: The information presented on this blog is for educational and informational purposes only. The materials, including research and opinions, are based solely on my findings and should not be considered professional financial advice or a definitive statement of fact. I cannot guarantee the accuracy, completeness, or reliability of the information provided. I shall not be held liable for any errors, omissions, or losses that may occur as a result of using the information presented on this blog. It should be noted that the information presented on this blog does not constitute a buy, sell, or hold recommendation for any security. It is crucial to conduct your own thorough research and due diligence before making any investment decisions.

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